How to overcome this: Get your own financing – Typically your Credit Union or Bank could of offered you the example 7.9% rate or maybe even better. If you can’t get your own financing – Ask the Finance Manager to show you the lender’s call back sheet. If he/she does not show it to you, then it is a for sure sign that they are trying to raise your rate in order to make money off you. Try to negotiate the interest rate or you can threaten to walk. Depends on how good the rest of the deal is. Is this right? Yes and No Yes, it’s right because if you cannot get your financing lined up either because you did not want to put the effort into it or you were turned down everywhere. And the Finance Manager pulls strings to get you bought, then he or she should make some money. As a matter of fact, there are some banks and credit unions that offer dealerships a better interest rate for their customers than they would give them if they walked in to the bank on their own. No, because you are entitled to the interest rate that the bank has offered you. You will pay hundreds in extra money by getting your interest rate raised by the finance manager. The outcome Always try to get your interest rate lowered by threatening to walk. A dealership will not let you go unless they feel that you cannot get a better interest rate elsewhere. ( this might be true so be careful with your threat) This Holding Points of Rate situation only pertains to prime and some sub-prime lending. If you are getting 2nd chance or in-house finance, you better believe the interest rate is going to be high and the dealership and making anything of the points!

How Dealerships make money off your APR Rate!

This is a very important Financing Scams that you should be aware of

Now that you how to be aware of common Finance Scams, you can learn about Auto Insurance

Chapter 3 Steps

You might make all of your payments on time but if your debt to income ratio is too high it can lower your credit score! So keep your open accounts to a minimum and don't run your credit until you are ready!

Holding Points of Rate

This is where dealerships make money off your interest rate! The Finance Manager will submit your application to to a few lenders. The lender will then reply with the answer or “call back.” This “call”back will provide the details of the loan and the requirements.

The “call back” terms will be something like this:

36/48/60/72 months,

$XXXX.XX (the max amount that they will finance)

Stips required (proof of income, address, etc.)

7.9% Buy Rate (The buy rate is the interest rate approved) I’m using 7.9 as an example

Basically the lenders will allow the dealership to make money off of you by bumping the buy rate 2 or 3 points. If the Finance Manager gets you to sign at 9.9% rate, the bank will pay the Dealership the extra 2 points for their service.

1. Warranties Learn what to look for in a good Warranty

2. Finance Scams Learn about the Finance Scams that occur every day.

3. Auto Insurance How to buy Auto Insurance and lower your bill.

4. Insurance Store Get the lowest quotes on Warranties, Gap Etc.

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CHAPTER 3